House votes to cut taxes on the wealthiest dead

The House of Delegates overwhelmingly approved a tax cut in Friday’s session that would benefit Maryland’s millionaires after they die.

In a 120-13 vote, the House voted to exempt more assets from the estate tax, which taxes a property of a deceased individual if it’s valued at $1 million.

If signed into law as is, HB 739, sponsored by Speaker of the House Michael Busch, would increase the estate tax incrementally before matching the federal exclusion level of $5.3 million in 2017.

“It’s a shame that in Maryland, you can’t get a tax break until you’re dead,” said Republican Del. Herb McMillan prior to the vote. “I would prefer to get one while I’m still alive.”

The bill’s proponents say that cutting the estate tax will ensure Maryland’s wealthiest won’t flee to other states, namely Delaware and Florida.

Montgomery County Del. Heather Mizeur, a candidate for governor and a vocal opponent of slashing the tax, said the legislation was fast-tracked because General Assembly leadership was eager to push it through. The companion bill in the Senate, SB 602, is sponsored by Senate President Mike Miller, and was heard in Senate Budget and Taxation Committee Wednesday.

“We have to ask ourselves why,” Mizeur said in an interview after session. “Why are we giving a five-year $532 million giveaway to the top 3% wealthiest families in our state at the same time revenue write-downs are making our pencils go back to the budget?”

Mizeur said she was disappointed that revenue might need to be funneled from other areas — Chesapeake Bay cleanup, education, health care reform — to fund what was lost by the tax cut.

Delegate Mizeur seems to believe that money earned or assets accumulated during the course of one’s life is first the property of the government and then, if government is so inclined, reallocated to the person who earned it. It’s certainly a different way to view things….

John

So a bunch of Democrats just decided that reducing the (effective) tax rate will increase revenues. Pretty darn interesting.